Beyond theory: Exploring concrete examples of open finance.
In the constantly evolving financial landscape, the introduction of open finance, driven by regulations like Financial Data Access (FIDA), has brought forth a new era for both companies and customers. This concept exposes banks and insurance companies to advanced technology, offering a wide array of benefits for financial institutions and their customers. In this blogpost, we’ll dig into five use cases of open finance and exploring its potential impact on banks and insurance companies.
Customer experience stands as a cornerstone in financial service delivery. Open finance empowers customers to control their data, ensuring financial companies meet this non-negotiable aspect. By embracing the ability of customers to share pension savings or insurance data, financial institutions can significantly increase their assets under management. This not only streamlines data accessibility but also enhances customer experiences through automatic data collection, paving the way for seamless interactions.
Capital growth through data accessibility.
Open finance thrives on data accessibility, visibility, and sharing. For insurers and banks, embracing these characteristics accelerates customer decisions to entrust their pension savings or insurance with you, ultimately boosting assets under management. Centralization, made possible by open finance, streamlines the management of multiple accounts, leading to improved customer experiences. Increasing assets under management not only reflects positively on your brand perception but also makes pension and insurance-related information more understandable for customers.
Digital distribution advantage.
Access to real-time data in the open finance landscape enables digital distribution of pension and insurance products. Digital distribution enhances the customer journey by offering a stress-free experience and increasing conversion rates through personalized offers. Furthermore, data access aids in refining offerings, pricing strategies, and staying competitive in the market.
Data-driven advice for informed decision-making.
Open finance provides a new dimension to data use, allowing financial institutions to leverage real-time data for informed decision-making. The ability to offer expert, data-driven, and personalized advice to customers enhances trust and identifies coverage gaps. Data-driven decision-making eliminates guesswork, improves customer retention, reduces costs, and elevates customer care standards.
Streamlining pension transfers.
Pension transfer processes, often complex, can be streamlined with open finance solutions. By eliminating manual steps in managing customers' pension accounts—such as contacting pension institutions, form filling, and waiting for authorization—financial institutions can offer a smooth pension transfer experience. Real time access to customer data enables a quick overview of accounts, simplifying the transfer process, reducing costs, and increasing returns for both the bank and the consumer. A true win-win.
Personal and business financial management.
For organizations offering personal and business financial management services, open finance provides visibility into customers' finance data. This visibility opens avenues for tailored recommendations and expert advice, empowering both individuals and businesses. Customers and financial managers can make well-informed decisions regarding spending, investing, and choosing financial products based on real-time data. Open finance becomes a pathway to building customers' financial capacities.
In conclusion, the utilization of open finance in the financial industry creates a win-win situation for both financial institutions and their customers. At Insurely, we leverage open finance to empower insurers and banks, while simultaneously assisting customers in making informed choices about insurance. If you’re curious to know more, contact us - we’re always happy to talk open finance.